Hiring a bookkeeper can be one of the most important decisions you ever make as a business owner since a good bookkeeper can keep you on the straight and narrow, while a bad one will most certainly derail you.
In this article, we will look at the key skills and attributes you should look for when hiring a bookkeeper. We hope that these tips will help you find the ideal person to work with you.
A good bookkeeper will be the glue that holds an organization together. It is therefore critically important that he/she has the experience in balancing the books for an organization of similar size and complexity to yours. You should also look for someone who has worked in a firm at a similar point in their business lifecycle. For example, the bookkeeping requirements of a startup with high growth potential will be radically different from those of a company that’s been around for decades. An experienced bookkeeper should be able to think ahead and anticipate needs before they arise and should have experience with your industry and understand its unique bookkeeping requirements.
Training and Education
A good bookkeeper should be educated and trained and have a high degree of business acumen. While a master’s degree may not always be needed, it is important that they at least understand basic business accounting and finance. A bookkeeper should be trained and keep themselves informed of changes to accounting rules and procedures that directly affect their role.
Aptitude for Technology
Unless your company is stuck in the Dark Ages, you most likely use a software system to keep your company financials and manage your books. The right bookkeeper should be trained and have experience using your bookkeeping/accounting software. They should be adept at using other common tools such as Microsoft Excel and any industry-specific systems you have (e.g. estimating, billing systems.) They should be able to process online payments and perform bank reconciliations.
Attention to Detail
By the nature of the role, a bookkeeper must have keen attention to detail. They should have the ability to identify errors and balance accounts on the fly. They should be able to generate timely and accurate financial reports that are clear and concise.
Credit and Cash Flow Management Experience
One of the most important skills a bookkeeper should possess is the ability to keep on top of cash flow and to anticipate cash flow requirements. Factors such as business seasonality, taxes, bonuses and recurring annual events must be considered when determining cash flow needs. The bookkeeper must be able to balance all these requirements to maintain business stability. A bookkeeper should also know how to appropriately use credit during periods when cash flow is low. Controlling debt expenses must all be factored in and an experienced bookkeeper should look for the most favorable rates and terms for credit.
Tax Preparation and Planning
Your bookkeeper should know how to get your company prepared for tax season. They should know the applicable tax deadlines for items such as quarterly tax estimates. They should know how to keep books and receipts well organized for tax seasons as well as audits. While it is advisable to use an accountant to prepare your corporate taxes, a bookkeeper plays a vital role in getting an organization ready.
Like we said earlier, hiring a bookkeeper can be one of the most important decisions you make for your small business. Want to know more about selecting the right bookkeeper for your unique needs? Contact the team at Nexgen Accountants today.